MANHASSET, N.Y. An American Technology Research report said that previous guidance for semiconductor suppliers Micron Technology Inc. and Maxim Integrated Products Inc. was likely on the aggressive side. The report issued modified guidance for both companies reflecting market conditions.
According to American Technology Research analyst Doug Freedman, Micron (Boise, Idaho) is likely to see lower gross margin in NAND flash. The firm now expects Micron to earn 30 cents per share its November quarter, compared to 38 cents per share previously. Micron is projected to earn $1.27 per share in its fiscal 2007 year, compared to $1.58 predicted earlier.
"We are resetting our margin assumptions for NAND (flash), which were likely too aggressive," the report stated. "This will be offset somewhat by the more positive DRAM environment. However, it must be noted that Micron will be constrained on DRAM bit growth as it transitions its technology manufacturing joint venture in Singapore to 300-mm capacity."
The report said Micron's transition to 300-mm capacity will disrupt DRAM bit output over the next 12 to 15 months, though increase with demand in the long run while helping the company diversify its product base.
Last week, American Technology Research issued an optimistic outlook for Micron, citing the company's diversification strategy and move into specialty memory products.
The firm also reduced its September and December sales quarter estimates for Maxim (Sunnyvale, Calif.). On Monday, Maxim lowered its September quarter guidance, projecting sales to decline up to 3 percent sequentially, versus previous guidance of up 1 to 3 percent.
"We are somewhat surprised that Maxim lowered revenue numbers for the September quarter given the company entered the quarter with 11 of the 13 weeks booked in backlog," the report said. We believe Maxim needs to improve the accuracy of internal sales forecasts versus end customer demand in order to have product on hand that meets customer needs."
American Technology Research lowered its December quarter estimates for Maxim, projecting the semiconductor supplier to see sales rise only 0.5 percent sequentially, compared to 5 percent sequentially.
Though the firm expects December quarter orders to pick up, it questions whether Maxim to increase turns shipments to meet demand.